Plans from Trump's team

This is why Musk also wants to abolish the bonus for electric cars

Abolishing the tax credit for electric vehicles will also hurt Musk's Tesla - yet he is also in favor of it.(Bild: AFP/Jim WATSON)

According to insiders, the transition team of US President-elect Donald Trump wants to abolish the tax credit of up to 7500 dollars for the purchase of electric vehicles as part of a comprehensive tax reform. This is despite the fact that Elon Musk, the head of e-car manufacturer Tesla, will play an important role in Trump's administration.

The plan is currently being discussed by the group, two people familiar with the matter told Reuters on Thursday. 

Death blow for mobility transition?
The meetings of the energy policy transition team are reportedly being led by oil billionaire Harold Hamm, founder of Continental Resources, and North Dakota Governor Doug Burgum. The abolition of the tax credit could have major consequences for the already stalled transition to e-cars in the USA.

Musk: This will destroy rivals
Nevertheless, representatives of Tesla - by far the largest seller of electric cars in the USA - told a Trump transition committee that they supported the abolition. Tesla CEO ElonMusk, one of Trump's biggest supporters and the world's richest person, had said earlier this year that while the repeal could slightly hurt Tesla sales, it would devastate its domestic rivals, which include long-established automakers such as General Motors.

The tax credit is one of the key measures in President Joe Biden's more than $300 billion IRA subsidy package. With the ambitious e-car subsidy, Biden wanted to ensure that every second new car sold would be electric by 2030.

Trump wants a U-turn for the USA
Representatives from the Trump transition administration and Tesla did not immediately respond to a request for comment. The Alliance for Automotive Innovation, a trade group that represents nearly all major automakers besides Tesla, also did not immediately respond.

The alliance urged Congress in an Oct. 15 letter to keep the tax credits for e-cars, calling them "critical to solidifying the U.S. as a world leader in the future of automotive technology and manufacturing."

Trump had promised before the election to increase oil production in the US and roll back Biden's costly clean energy initiatives. In addition to the tax credit for electric cars, these include subsidies for wind and solar energy and the mass production of hydrogen.